Sanmar buys US-based Matrix Metals

The Rs 1,596 crore Sanmar Group has acquired Matrix Metals LLC, a portfolio company of Jefferies Capital Partners.

According to a release issued by Sanmar today, the merger between the two companies is expected to create create one of the leading specialty steel casting groups in the world. Sanmar officials declined to disclose the acquisition cost or other details of the deal.

The deal is the culmination of the close relationship between Chennai-headquartered Sanmar and Matrix’s NEPCO unit, which has sourced castings from Sanmar for several years.

"Combining Sanmar’s expanding foundry capacity with ours will enable us to meet almost any North American customer’s casting requirement and create new business opportunities across the combined companies," Roger Courtney, CEO, Matrix, said in a statement.

The transaction has been funded by a bridge facility provided by Bank of India and State Bank of India branches in New York, Sanmar officials said.

B Natraj, corporate director, Sanmar Group, will relocate to the US and serve as executive vice chairman of Matrix. The group’s first priority will be to reinforce Matrix’s sales and marketing efforts in the US and serve a broader range of global customers, Natraj said. "We plan to supplement Matrix’s established foundries in Keokuk, Houston and Mexico with our expanded operations in India to meet those needs," Natraj added.

The $157 million Matrix Metals employs over 1,300 people and operates one of the largest steel casting businesses in North America.

Sanmar had acquired German alloy castings producer Eisenwerk Erla GmbH in 2007.